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HomeArchived E-NewslettersDeluxe Payroll Newsletter – May 2013

Deluxe Payroll Newsletter – May 2013

August 24, 2017

Payroll Help Desk

For those employers who rely on Payroll Service bureaus to assist with payroll, you are in good hands. Within the last four years, payroll services have been put to task to keep you in compliance with economic stimulus measures like Make Work Pay, 2009 Consolidated Omnibus Budget Reconciliation Act health insurance subsidy, The 2010 Hiring Incentives to Restore Employment Act, and recently, healthcare reform under the Patient Protection Affordable Care Act (PPACA). These do not include drastic hikes in unemployment rate changes, enforcement of wage and hour laws and a great deal of state wide changes like conforming to the Health Care Act (or not), and tax treatment for same sex couples.

Next on our list of helping clients work through the maze of compliance issues is our 2014 Healthcare Checklist. Your company should prepare now (2013) for these requirements.

  • If you are an employer with 50 or more Full Time Equivalent Employees (FTE) you must calculate how many FTE’s you have by adding the monthly hours worked by part-time or seasonal employees and divide that by 120. Add this number to your count of FTE’s (working 130 hours or more in each month). You will now have your sum total of FTE’s. There will be lookback periods assigned to this calculation, meaning 2013.
  • Be informed within your state, as every state must have an operational exchange by January 1, 2014. If your state refuses to set up an exchange it will default to the federal exchange.
  • If your business currently has a health plan for employees, know your “essential health benefits”. Your plan must include essentials such as Emergency and ambulatory services, hospitalization, maternity and newborn care, mental health and substance use services including behavioral health treatment, rehabilitative and habilitative services, laboratory services, preventative (wellness) services, pediatric services including oral and vision care and a prescription drug plan.
  • Be prepared for higher costs associated with market reforms and reporting requirements.

Tax News & Notes

As part of the American Taxpayer Relief Act signed on January 2nd by President Obama a 39.6 percent bracket for high-income earners was put into effect, along with other changes. This rate also applies to the required flat-rate withholding tax on supplemental wages an employee receives that total more than $1 million in a year. The optional flat rate for supplemental wages under $1million remains at 25%.

Seasonal Items

U.S. Citizenship and Immigration Services (USCIS) has issued the revision of Form I-9 Employment Verification Form. Pay attention to the revision date on the current forms you have on file for each employee. USCIS advises that employers should use the new version of this form immediately. After May 7, 2013 only this newest version dated March 8, 2013 is acceptable. The new form is now two pages long and has three sections. The first section must be completed on the first day of hire. Do not file this form with USCIS. Keep the form on file for each person on payroll as long as the individual works for your company. If the employee is terminated keep this form for up to three years after the date of hire or one year after the date the employment ended, whichever is later. The new I-9 form is located at

Did You Know?

President Obama announced in February his plan to raise the federal minimum wage amount to $9 by the end of 2015. The current federal minimum wage has been $7.25 since 2009.
Did you know that tipped employee’s minimum wage in many states is currently $2.13 per hour? It is assumed that the tipped employee will make the difference between $2.13 and the minimum of $7.25 in tips received. Proposed legislation in Congress this year would raise the $2.13 for the first time since 1991. New Mexico and 12 other states use this hourly wage for their waitstaff’s minimum wage. This rate is known as the federal level for tipped employees which has not been increased correspondingly as the prices for everything has risen. This wage represents about 29% of the current minimum wage which has been raised four times since 1991. This is food for thought on your next dining out adventure.